China Market (2010-11-12 SSEC analysis)

HSI has been moving down and up and down this week. It is more or less the consolidation I mentioned on Monday. Instead of looking at it again, why not do analysis on the market that would affect HSI quite a lot.



Above is the daily chart of Shanghai Stock Exchange Composite Index (SSEC). The index broke the very long-term downtrend line (in red) in late Sept 2010, and it is definitely in bull market currently.

However, by using fibonacci projection on the green pennant, it has reached the 161.8% level and is facing resistant. The index is struggling to break this level, but it seems there is big selling so it could hardly break it.

MACD and EMA are whip-sawing so we could hardly tell what would happen next. However, the chance for dropping would be higher given MACD is at such high level.

2,950 would be the support, given by both the 100% fibs-level and the long-term red downtrend line.

3,481 was the high in 2009 and it would definitely be a big resistant for SSEC.